China takes more assertive line in South Sudan diplomacy

Residents displaced by recent fighting gather at a trading area within the United Nations Mission in South Sudan (UNMISS) camp in Malakal, Upper Nile State, South Sudan, May 1, 2014. REUTERS/Drazen Jorgic

* China envoy says Beijing learning in new role

* Bigger economic interests push China to action

* S. Sudan accounts for 5 percent of China oil imports

* Beijing scrapped arms deal with Juba over conflict

By Drazen Jorgic

JUBA, June 5 (Reuters) - China is swapping its reserved diplomacy for a hands-on approach to help resolve a more than five-month-old rebellion in South Sudan that threatens Beijing's oil investments.

The subtle change has been evident in months of faltering peace talks in the Ethiopian capital, where Chinese officials have been in regular contact with Western diplomats to help regional African mediators push for a halt to fighting.

Diplomats say the permanent Chinese presence at the Addis Ababa talks and their frequent lobby chats and closed-door consultations with diplomats from the United States, Britain and Norway - the main Western backers of newly independent South Sudan - shows China's more proactive approach.

When a first ceasefire deal was reached on Jan. 23, a month after fighting erupted, a senior Western diplomat said China's Ambassador to Ethiopia, Xie Xiaoyan, joined other envoys by giving a speech at the signing that set the tone for Beijing's involvement.

"What's very striking is that ... he was given the floor and did not vary one bit from what everyone else was saying, which was basically (telling the South Sudanese factions to) 'Get your act together'," said the diplomat.

The new line does not mean China plans to abandon its oft stated policy of steering clear of Africa's internal politics, but it is an indication of a gradual shift by Beijing as its stake in Africa's stability grows with expanding investments.

With China now Africa's biggest trading partner, Beijing could face pressure to extend its new approach to other regions of Africa where it has growing economic interests.

"The luxury of being the new guy in town is definitely on the wane now that they have pretty serious assets in these countries and need to protect them," said Clare Allenson, Africa analyst at consultancy Eurasia Group.

"They would love to keep the non-interference stance but it doesn't quite work that way."

For now, South Sudan offers exceptional circumstances to prompt more proactive Chinese diplomacy: 5 percent of Beijing's oil imports came from South Sudan when it was pumping at full tilt. The state firm China National Petroleum Corp has a 40 percent stake in a joint venture developing the fields.

Oil accounts for about 98 percent of South Sudan's revenue and while the United States, Britain and Norway are the biggest donors, they do not have stakes in South Sudanese crude production.

Washington instead worries about the loss of political face over the fighting after it trumpeted secession from Sudan in 2011 as a foreign policy success. It has imposed sanctions on military commanders from both sides to press for a peace deal.

France's Total has exploration concessions in South Sudan but China's commercial interests are far greater than those of Western nations.

PEACEKEEPING TROOPS

This has prompted China to push rival factions loyal to President Salva Kiir and rebel leader Riek Machar to talk. It also led Beijing to halt negotiations over an arms deal with the government.

China's ambassador to South Sudan, Ma Qiang, told James Hoth Mai, the then chief of the government SPLA army, that the arms agreement was off shortly after the conflict erupted on Dec. 15.

"(The envoy) said: 'We cannot do anything now people are killing each other. We don't want to contribute to that killing'," former commander Mai, who was replaced in May, recounted in an interview with Reuters at his home in Juba.

"China said 'We don't want to escalate this conflict'."

Senior Western diplomats involved in mediation efforts, which have been led the Intergovernmental Authority on Development (IGAD), a grouping of eight eastern African countries, said they were unaware of a Chinese decision to halt an arms sale but they have no doubt there has been a change.

"The diplomacy of Beijing has clearly stepped up and is more proactive and more responsive now," said one of the diplomats, who traces the first sign of a shift to the row between South Sudan and Sudan in 2012, the year after the two nations split.

China's role was seen as crucial to ending the dispute that rumbled on for 15 months, halted South Sudan's oil production and brought the two nations to the brink of war.

"You can see a clear evolution over the past two years," said the diplomat.

South Sudan's oil output is now running at a third of the level it was at in December before the latest conflict erupted, and is now hovering at about 165,000 barrels per day. Chinese workers were evacuated from some fields.

That has spurred China on. From the early days of the conflict, China had said it would play an active role, although it had not clearly indicated how its actions would change.

"It's a new challenge for us," China's special envoy for Africa, Zhong Jianhua, said in February. "Since it is new for us, we ... always do things pretty cautiously like that. We are not only a participant, but also learning."

In another unusual move for Beijing, U.N. peacekeeping chief Herve Ladsous said China planned to send a battalion of troops to join the peacekeeping mission in Sudan.

U.N. officials said this would be the first time China had contributed a full infantry battalion of about 850 troops to a U.N. peacekeeping mission. Last year China sent a smaller "protection unit" to join the U.N. mission in Mali.

"China's support for the United Nations, at this juncture, is a real demonstration of a commitment to work through a multilateral institution that's not always associated with China," said Casie Copeland of the International Crisis Group.

She added that it might indicate "the way forward that we are going to see China being pushed" by the West and others.

DIRECT INTERVENTION

China has also given more than $1 million to an IGAD-proposed monitoring mechanism to record violations of a second ceasefire deal, which was agreed in May after the January deal collapsed swiftly after it was agreed.

"We have huge interests in South Sudan so we have to make a greater effort to persuade the two sides to stop fighting and agree to a ceasefire," Ambassador Ma said in an interview at the Juba embassy that was accompanied by a computer presentation about China's role.

In one direct intervention by the Chinese envoy in Juba, Ma convinced the government to allow the United Nations to relocate a camp in Juba of 15,000 mostly displaced Nuer people which faced the prospect of flooding with the onset of rains.

The government had argued against a relocation and instead wanted to dismantle the camp, where Nuers had sought shelter. It changed tack after talks with Ma and when China's state oil firm promised almost $2 million to build the new camp.

"That's been extremely helpful," said Hilde Johnson, the outgoing chief of the U.N. mission in South Sudan.

At least 10,000 people have been killed and more than 1.3 million displaced since the start of fighting that has largely run along ethnic lines, pitting Kiir's Dinka people against Machar's Nuer, two of South Sudan's largest ethnic groups.

The violence sent a new shockwave through a region already plagued by conflicts, such as the Central African Republic and eastern Democratic Republic of Congo.

China's new more assertive approach has been welcomed by regional African nations, worried about another descent into chaos that could increase the flow of refugees and derail what has been for many countries a period of strong growth.

"(China) possesses substantial political, diplomatic and financial assets, which, if fully applied, would be a game-changer in the region's peace and security," Kenyan President Uhuru Kenyatta said at a news conference during a visit to Nairobi by Chinese Premier Li Keqiang in May.

During his African tour, Li repeated the Chinese mantra that Beijing would not interfere in Africa's internal politics while also pledging more aid and signing a slew of new contracts.

A more diplomatically active China could provide a welcome political counterweight for some on the continent, where the West has often been called to act to police the peace.

"Now China is coming in and it means the West cannot use their help to hold us hostage any more," said one official in Uganda, which has been criticised by some Western diplomats for sending troops to South Sudan in open support of Kiir's forces.

South Sudanese Foreign Minister Barnaba Marial Benjamin acknowledged that China was gaining traction on the continent, citing support for Africa on the U.N. Security Council.

"This has given them the respect in Africa," Benjamin said. "So when they come to us people will actually listen to them."

(Additional reporting by Edmund Blair in Nairobi, Elias Biryabarema in Kampala, Ben Blanchard in Beijing and Michelle Nichols in New York; Editing by Edmund Blair and Anna Willard)

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